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New TPG and iiNet customers asked to waive their service guarantee rights

Customers may not be clear about their rights when it comes to their landline and internet services.

customer service guarantee waiver
Last updated: 01 November 2021
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Checked for accuracy by our qualified fact-checkers and verifiers. Find out more about fact-checking at CHOICE.

Need to know

  • TPG Telecom Limited, which owns iiNet and TPG, make some new customers sign a Customer Service Guarantee waiver 
  • Customers may not know the waiver only covers landline phone service
  • Advocates say to read the fine print and not be pressured into agreeing to anything 

Customers of Australia's second-largest telecommunications company are being asked to sign waivers of some of their rights when they sign up to phone and internet bundle packages. 

TPG Telecom Limited controls roughly 24% of the market as of 2021. Two of the groups' brands, TPG and iiNet, require new customers to waive the Customer Service Guarantee.

In some cases, these waivers are obtained verbally, and customers may be  confused about what they've agreed to.

What is the Customer Service Guarantee?

The Customer Service Guarantee (CSG) was established in the 'Telecommunications (Consumer Protection and Service Standards) Act 1999' and only relates to landline telephone services.

"Under the CSG Standard, customers can waive their CSG rights in whole or in part. These rights include the right to compensation should the service provider not meet the performance standards under the CSG," a spokesperson for the Australian Communications and Media Authority (ACMA) tells CHOICE.

This means that if your landline telephone connection goes down, the service provider won't be obliged to fix it in a certain timeframe or pay you compensation. 

If your landline telephone connection goes down, the service provider won't be obliged to fix it in a certain timeframe or pay you compensation

Signing the waiver has no bearing on your rights when it comes to your internet connection. But that distinction may not be made clear to customers.

And for TPG Telecom Limited customers who still depend on their landlines to make and receive phone calls and who live in places where mobile service is spotty or non-existent, losing phone service with no guaranteed remedy on offer can pose serious difficulties.

The Australian Communications and Media Authority (ACMA), which oversees the Act, says that in 2019 more than 1.8 million Australians had signed these waivers. TPG accounted for just over 50% of the waivers signed and iiNet for almost 30%.

Guarantee is only for landline – but do customers know?

Sarah is a Sydney-based freelance writer who has been a customer with iiNet for around 11 years. She says when they transferred her internet and phone bundle to a new plan in August this year they asked her to sign a waiver of her CSG rights.

Consent for the waiver was obtained verbally over the phone, and a copy of the waiver was emailed to her after.

"That waiver that the person mentioned to me on the phone – it obviously sounds a bit suspect, but I didn't have any problem agreeing to it initially because I had really good customer service from them in the past," she says.

Sarah thought she'd signed away her rights to access remedy for problems with her internet connection

However, since signing up for the new plan in August, Sarah has had many issues with the company, saying she has exchanged around 50 emails and had 30 phone calls about her poor-quality internet service.

Even though the CSG waiver doesn't relate to internet quality, Sarah didn't know that and thought she'd signed away her rights to access remedy for problems with her internet connection.

"With the poor experience I have had, [I thought the waiver had] removed the right to redress and I never would have agreed to it if I would have known how poor the standard would have been," she tells CHOICE.

Customers like Sarah may have thought they'd lost their right to complain about their internet service, but they haven't, and they should still seek redress when issues arise.

Australian Consumer Law still applies

Even when customers sign a CSG waiver they still maintain their rights to expect a reasonable service for both landline and internet under the Australian Consumer Law. Their rights when it comes to their internet service, in fact, don't change at all.

But this was never properly explained to Sarah, and the copy of the CSG waiver she was emailed by iiNet doesn't mention that she doesn't lose any of her internet rights or that she maintains her protections under the Australian Consumer Law for both internet and landline services.

The copy of the CSG waiver she was emailed by iiNet doesn't mention that she doesn't lose any of her internet rights

Melbourne University Professor of Law Jeannie Patterson, who specialises in consumer protection law, says many customers may not know they maintain their Australian Consumer Law rights even after signing a CSG waiver.

"I think there is a lot of confusion around what the CSG guarantee covers; it is a fairly narrow guarantee," she says.

"Most people are no longer dependent on home phone lines, so in that sense they protect a minimal amount of people, but I am also concerned that people who are probably on home landlines are elderly people or people in remote areas so those people being asked to waive rights is problematic," she adds.

"That's a problem in the provision of the right itself, because the telco can refuse to give you a service if you don't sign a waiver."

TPG responds

TPG Telecom Limited says that customers on internet and phone bundles would need to agree to sign the waiver or else they wouldn't be offered the service.

The company says their low prices offered on the phone plan would not be possible without a CSG waiver.

It wouldn't be possible to offer these low prices if compensation ... was payable under the Customer Service Guarantee

TPG Telecom Limited spokesperson

"TPG and iiNet voice services cost as little as $9.95 per month and in some cases are even offered as a free add-on as part of an internet bundle. It wouldn't be possible to offer these low prices if compensation of up to $48.40 per day was payable under the Customer Service Guarantee," a company spokesperson says.

"TPG and iiNet will always resolve any issues with voice services as quickly and efficiently as possible, and may still provide reasonable compensation, regardless of the waiver, depending on the individual circumstances," they add.

Read the fine print

Australian Communications Consumer Action Network Deputy CEO Andrew Williams says the organisation doesn't take a view on whether consumers should be signing the waiver or not, saying it is up to them to make a decision based on whether they think the service offered is worth the trade-off.

But he adds that customers needed to read the fine print and properly understand what they are getting into before agreeing to any waiver.

"They do need to make sure they understand what they are signing, and they do need to know that if they do sign the waiver of their customer service guarantee they are not signing away any of their rights under Australian consumer law," he tells CHOICE.

Just because they are waiving that guarantee doesn't mean they lose their other rights [such as protection against] misleading and deceptive conduct

Andrew Williams, Australian Communications Consumer Action Network

"Just because they are waiving that guarantee doesn't mean they lose their other rights [such as protection against] misleading and deceptive conduct."

He adds that it's important telcos help customers be aware of what they're signing and not put any time pressure on them to sign a waiver.

"There is a lot of legal terminology in there. [Customers] need to make sure the telco is giving them the time and space to read it and not pressuring them into signing."

You can read more about the customer service guarantee on the ACMA website at acma.gov.au/customer-service-guarantee.

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